Hurricanes and hedonism influence Florida demand

With the Christmas holiday season rapidly approaching, and snow and ice-storms impacting the US Midwest, a number of US airlines are launching seasonal services to warmer regions such as Florida. While Florida’s airports fall short of their Californian counterparts in terms of total state traffic, some 135 million passengers still pass through the region’s airports (about the same as through all French airports). The vast majority of these are served at just 10 airports.

Airport

Passengers 2005 (m)

Passengers 2006 (m)

Growth ’06 v ’05

Growth ’07 v ’06 YTD

Orlando (MC)

34.105

34.381

2.1%

4.3%

Miami (MIA)

31.008

32.534

4.9%

3.7%

Fort Lauderdale (FLL)

22.390

21.370

-4.6%

5.1%

Tampa (TPA)

18.900

18.868

-0.2%

2.6%

Fort Myers (RSW)

7.518

7.643

1.7%

7.2%

West Palm Beach (PBI)

7.014

6.825

-2.7%

2.1%

Jacksonville (JAX)

5.742

5.946

3.6%

7.8%

Orlando Sanford (SFB)

1.649

1.646

-0.2%

7.8%

Pensacola (PNS)

1.598

1.617

1.2%

n/a

Sarasota (SRQ)

1.338

1.423

6.4%

16.5%

Top 10

131.262

132.703

1.1%

4.4%

Source: Airport websites

Overall traffic grew by just 1% in 2006 after growth of nearly 8% in 2005 and double-digit growth in 2004. Orlando overtook Miami in 2004 to become the state’s busiest airport and the two ranked 23rd and 26th in the world in 2006 according to ACI statistics. Fort Lauderdale slipped out of the world’s top 50 airports as traffic at the airport fell nearly 5%.

Traffic numbers in 2007 appear to be promising with growth across airports averaging over 4% for the first 10 months of the year with none of the top 10 airports reporting a drop in passenger numbers. In 2006 four of the top 10 airports experienced declining demand.

Spring break and hurricanes impact seasonality

Florida’s airports have an unusual seasonality profile with demand reaching a peak in March and being lowest in September.

Source: Derived from BTS dat

The March peak can be explained by the phenomenon of ‘Spring Break’, a one-week holiday awarded to university students which typically takes place in March. Traditionally many thousands of students have headed south to the beaches in Florida to enjoy the sea, the sun and copious amounts of alcohol.

The dip in September corresponds with the typical peak of the hurricane season which impacts Florida to varying degrees each year. Some hurricanes have caused massive destruction in recent years and three of the eleven worst hurricanes in South Florida have occurred this decade – Hurricanes Frances and Jeanne in 2004 and Hurricane Wilma in 2005.

American is biggest Floridian carrier

An analysis of which airlines handled most passengers in Florida in 2006 shows that American Airlines, thanks to its dominant presence at Miami Airport, is the state’s leading carrier with just over 20% of departing passengers.

Source: Derived from BTS data

Southwest and Delta are fighting over second place with US Airways in a comfortable fourth place. The top 10 airlines account for some 81% of all traffic in Florida.

Air Canada is biggest foreign carrier

Air Canada is the top ranked foreign airline in 16th place followed by Virgin Atlantic and British Airways. Airlines from Colombia, Bahamas and Jamaica all feature among the top 10 foreign airlines. American Airlines uses its Miami hub to serve a wide range of destinations in the Caribbean, Central and South America. Among the most popular are San Juan (Puerto Rico), Santo Domingo (Dominican Republic), Port-au-Prince (Haiti), San Jose (Costa Rica), Caracas (Venezuela) and Sao Paulo (Brazil).

Air fares well below national average

Florida’s highly competitive leisure market has resulted in eight of the top 10 airports having average fares below the national average. Only Miami, which is dominated by American, has a significant positive fare premium.

Airport

Fare Premium
All Markets

Fare Premium
Short-Haul

Fare Premium
Long-Haul

Miami

8%

11%

7%

Pensacola

2%

5%

0%

West Palm Beach

-3%

12%

-4%

Jacksonville

-7%

-7%

-7%

Orlando

-8%

0%

-9%

Fort Lauderdale

-8%

-2%

-9%

Fort Myers

-10%

7%

-11%

Tampa

-11%

-5%

-13%

Sarasota

-13%

-5%

-14%

Orlando Sanford

-30%

-62%

-22%

Source: US DOT Office of Consumer Affairs (2007 Q1)

New LCCs seek out alternative airports

While fast-growing Allegiant Air has focussed on developing services to main Florida airports like Fort Lauderdale, Orlando Sanford and Tampa, newcomer Skybus has taken a more Ryanair-like approach to airports and identified two previously unserved airports capable of handling scheduled flights.

Skybus has become the first airline to operate scheduled services to Charlotte County Airport in Punta Gorda. This alternative to Fort Myers and Sarasota on the west coast of Florida is now linked to the airline’s main base in Columbus, Ohio as well as Greensboro, North Carolina and Portsmouth, New Hampshire.

St Augustine airport on the east Florida coast is an alternative to Jacksonville and Daytona Beach. Skybus became the first commercial airline to serve this airport when flights began to Columbus on 18 July 2007. The airport owes its 2,300-metre long runway to the Fairchild Engine and Airplane Company which developed major facilities there from the mid-50s onwards.